(CO B) Which statement is true?

Where the application of funds is less than the source, a taxpayer is deemed to have an understatement of income.

Beauty and barber shops are cash-intensive businesses.

Where the application of funds is greater than the sources, a person is deemed to have an overstatement of income.

The Cash T is appropriate for persons where a substantial amount of income is deposited in banks and the expenditures are proportionate to the income reported